SWEET 16
As a strategically located country in the Caribbean, Jamaica has huge potential in development and attracting foreign direct investment.
In December 2017, the Jamaica Special Economic Zone Authority (JSEZA), in association with the Planning Institute of Jamaica and the World Bank, launched the Jamaica Logistics Hub Master Plan, designed by the international consultancy Nathan Associates and executed by the sub-consultants from Berger ABAM through the Foundations for Competitiveness and Growth Project. This 20-year plan encompasses seven enablers, 65 strategies, and 105 recommended actions that will enable the full development of the ports and boost the strategic position of Jamaica not only in the Caribbean, but throughout the Americas.
During the first five years, the plan focuses on the development of nearly 3,900ha across the island, USD28 billion in infrastructure improvements, and 87,400 direct jobs to create the special economic zones (SEZs) to achieve the ultimate objective of becoming a logistics hub in the western hemisphere.
According to JSEZA, the SEZs are meant to bring together manufacturing companies and companies focused on exporting or re-exporting goods, integrating supply chains, and linking manufacturing, value-added capabilities, and trans-shipment. In order to attract more companies, the SEZ Act, which came into effect in August 2016 and gave JSEZA its mandate, offers benefits such as lower taxes, withholding tax concessions, duty-free importation of building materials, exemption from stamp duties and customs administration fees, general consumption tax exemption or deferment, and conditional property tax exemption.
The government is conducting feasibility assessments as 16 SEZs are planned for the island. The development of the logistics hub will begin with the study for the Caymanas Special Economic Zone, dredging of the shipping channel in the Kingston Harbor, expansion of Esquivel and Kaiser ports, private concession of the Kingston Container Terminal, privatization of the Kingston Airport to bring more passengers and cargo, development of the port in Montego Bay to be a multi-use facility, and improvements to Sangster International Airport, especially with regards to cargo.
This historical initiative drives to position Jamaica as the fourth node in the global logistics network, after Singapore, Dubai, and Rotterdam. Taking advantage of its geographical and strategic position in the shipping and logistics industry, it aims to attract FDI and companies of various sizes committed to the development of the country.
One emblematic example is the Jamaican-Gansu International Industrial Park, a collaboration with the Chinese company Jiuquan Iron and Steel Company (JISCO)—operator of Jamaica's JISCO Alpart alumina refinery—that will invest over USD3 billion for industrial development in Nain. In total, the project is expected to bring overall investment of USD6 billion to the Jamaican economy and offer over 60,000 jobs. Most likely, the park will break ground by the end of 2018, with work continuing on into 2019 and beyond. In June 2018, Minister without Portfolio Hon. Mike Henry spoke of the project's six main functions: processing and manufacturing, modern logistics, international trade, research and development, professional services, and urban support.
The Logistics Hub Initiative is regarded as pivotal to generate higher-level sustainable economic growth, greater fiscal stability, and significant job creation. In an interview with TBY, Eric Deans, CEO of JSEZA, emphasized this, elaborating that the logistics master plan, as one of the most significant achievements in Jamaica's modern history, was designed as a comprehensive, integrated development strategy for the country and all the stakeholders involved. Deans explained that the authority plays a critical role in the country's growth strategy by attracting FDI. Over the last 10 years, the economy has averaged between USD400-600 million in FDI per year; with this initiative, hopes are set on USD1-2 billion annual FDI. Combined with enhanced roles for the tourism and agriculture sectors, the island is set to register substantial economic growth and FDI triggered by a logistics-centered economy.
SWEET 16
TABLE OF CONTENTS
Interview
Michael Lee-Chin, Founder and Chairman, Portland Holdings, Chairman, Economic Growth Council, Chairman, National Commercial Bank (NCB)
Portland Holdings manages public and private equity and strives to build strong businesses that support the well-being of the communities in which they operate.
read articleCommuniqué
A Legal Introduction to Jamaica’s SEZ Regime
A special economic zone (SEZ) is as a geographical demarcated area within a country's national borders that is governed by trade and business laws that are distinct from the laws of the rest of that country. The objective of an SEZ is usually to attract investment to a nation's shores, and thereby increase employment and economic growth.
read articleInterview
Daryl Vaz, Minister with responsibility for Land, the Environment, Climate Change, and Investment, Ministry of Economic Growth and Job Creation
The Ministry of Economic Growth and Job Creation is working hard to ensure Jamaica's growth doesn't come at the expense of its environment.
read articleFocus: Brain drain
Holding on to the Best
Given its close proximity to North America's economic powerhouses and its warm relationship with its former colonial power, Jamaica's best and brightest have long decamped for more developed shores. The government is now fighting to encourage them to stay at home.
read article